IQ Option Review
IQ Option is an unreliable trading broker that does not always have the best interest of clients in mind. The company has a system in place to build rapport with investors, but unfortunately often does not deliver on its promises. While IQ Option has created a reputation for itself within the industry, its services and results are not as competitive as other trading brokers. Therefore, IQ Option cannot be truthfully recommended.
IQ Option’s Focus on Customer Service Attempts to Minimize Flaws
IQ Option does offer an easy-to-use application for its users. One of the ways the company can entice users is by creating a friendly customer experience. This can increase the brand’s overall likeability. The key thing to highlight here is that this is an aesthetic benefit, rather than a result- driven benefit. Sure, the company’s online platform may be attractive, but what truly matters is if IQ Option produces results or not. An easy-to-use application does not mean anything if the results are poor.
Along with its application, IQ Option allows investors to customize and personalize their user interface experience. In turn, this gives the clients a sense of comfortability and belonging to the company. A personalized experience can make someone, in other words, feel more at home. With binary trade brokers like IQ Option, this can make all the difference. These brokers want potential investors or veteran investors to be as comfortable as possible. More about binary trade options will be discussed in greater detail below.
Building trust is imperative if the company wants someone to invest his or her life savings or significant funds into their CFD trade options. Every single pro has one thing in common: the overall customer experience. None of the company’s pros deal with investment gain. Each pro is strictly about the experience between the brand and client.
Why does IQ Option want to craft such a great customer experience? It wants to earn the initial trust of its clients. In turn, clients will invest in CFDS and if they like the results shown on paper, they will keep investing.
According to customer sources, IQ Option is not afraid to let smaller withdrawals happen in the beginning, but many large withdrawals have had significant issues. This will be discussed below. Like any investment, there is also significant risk and the reality of loss. With a binary trader like IQ Option, the percentage of loss becomes far more prevalent.
IQ Option wants a variety of clients to learn about and ultimately invest in the company’s binary trading options. At the heart of building rapport and creating a customer relationship is excellent service and support. IQ Option understands this completely. If one were to ask any of its clients about initial customer support, most would argue that IQ Option’s service was very competitive. Again, similar to an appealing application, the company’s focus on providing a pleasant support experience is not nearly as important as results and investment outcomes.
There are some investors who have had solid results with the company, but a vast majority have had conflicting experiences. Some of these experiences will be laid out in greater detail in the Cons section.
IQ Option desires to be an attractive trade banking broker. One thing an investor absolutely cannot stand is expensive fees. To be more appealing, IQ Option has created a platform with no deposit or withdrawal fees. They do have a Dormant fee, which is one of the company’s many cons, but they are easily able to attract potential investors due to their overall lack of fees. The initial hook that sells an investor is critical to the success of brokers like IQ Option. ‘No fees’ will grab the attention of countless investors all around the world.
Trading and Regulations
All legal and trustworthy trading banks and brokers must be regulated. Often trustworthy brokers are under the jurisdiction of the U.S. Securities and Exchange Commission (SEC), Financial Conduct Authority (FCA), or the Financial Industry Regulatory Authority (FINRA), but the foreign-based IQ Option is regulated by the Cyprus Securities and Exchange Commission.
CySEC, which is operated in the country of Cyprus, is not as trusted or respected as organizations like the SEC. There is a possibility that CySEC will not be as strict in its regulation as U.S. or U.K.-based organizations.
IQ Option’s specialty offering is CFDs. What is a CFD? According to Investopedia, “a contract for differences (CFD) is an arrangement made in financial derivatives trading where the differences in the settlement between the open and closing trade prices are cash-settled. There is no delivery of physical goods or securities with CFDs.”
All stock and ETF options available are strictly CFD’s. No real stock can be acquired with this company. A client must be interested in derivative investing if he or she desires to use IQ Option. There are pros to derivative investing such as an agreed-upon price or earning percentage, but some investors view the risks as far greater.
In essence, clients are not trading real and tangible assets. They are similarly entrusting the broker to trade on their behalf and pay the agreed-upon percentage in the CFD contract. Core to such an investment is trust. IQ Option has not produced as many successful results as competitors. In fact, some IQ profitable results have been withheld from their rightful investors.
IQ Option does not allow the practice of scalping. According to Investopedia, “scalping is a trading style that specializes in profiting off of small price changes and making a fast profit off reselling.” The allowance of scalping is at the discretion of each individual broker. Some traders greatly enjoy the ability to scalp. This trading technique is not available to use when trading with IQ Option.
Many brokers offer a healthy variety of stocks, cryptocurrency, and Forex options. As of 2021, IQ Option has only 260 investment options for clients to select. This is limited in comparison to other trading banks in the industry. Not only are there only 260 options, but they are all derivative securities. None of IQ Option’s offerings are tangible or real securities.
Risks Involved with Binary Trading and IQ Option
CFD’s and other forms of derivative investing are complicated and often very risky. The concept of a CFD is risky in itself. A client must instill an incredible amount of trust in a broker to invest in a CFD. A broker can illegally refuse to pay the agreed-upon earnings.
Additionally, more leverage can be just as much as a con as a pro. If an individual invests in a high leverage option but the investment proves to be unsuccessful, said individual can dig a hole that is very difficult to get out of. CFD’s leverage flexibility is just one reason why such an investment can be far risker than other options such as real stocks.
IQ Option has a very mixed reputation. Some clients have had a positive experience with the brand, while others have clearly expressed the opposite.
One common critique about IQ Option is the numerous occasions where investors were unable to receive their earnings. In other words, some clients who invested a great deal of capital in IQ Option trades were not able to withdraw the profits they earned from the trades. A portion of these clients even had trouble accessing their accounts and claimed they were intentionally locked out.
IQ Option is a foreign-based binary option trader. Though IQ Option is one of the most popular and recognized binary traders, there is often skepticism about the risk involved with binary foreign investment. According to Investopedia, “non-U.S. binary options typically have fixed payouts and risk and are offered by individual brokers rather than on an exchange.”
Often, individual broker control on investment can be seen as a red flag by some investors due to significant losses. Even the SEC warns against the complications of binary options. Binary trade options have gained the attention of scammers, con artists, and fraud actors.
- According to the SEC, “much of the binary options market operates through Internet-based trading platforms that are not necessarily complying with applicable U.S. regulatory requirements and may be engaging in illegal activity.”
This is not to say IQ Option is directly involved with such people; however, one must be extra cautious when investing in a foreign-based binary trade broker. Many binary trade options can easily become the target of evil and deceitful people who want to take advantage of innocent investors.
Fortunately, some of these clients were able to recover the capital they initiated invested. Again, not everyone has had a poor experience like this with IQ Option, but just the thought of such a possibility should be a red flag.
Inactivity Has a Cost
If a client does not use his or her IQ Option account within a 90-day period, a fee of $10.89 or €10 will be charged. If the said client continues to not use IQ Option, a $10.89 fee will be charged each month.
IQ Option’s Competitors Offer So Much More
Based on client experiences and an overall examination of IQ Option’s services, it is advised that potential investors explore other opportunities. If a client wants to enter Forex trading, there are numerous different foreign exchange trading options that are safe, reliable, and offer better results than IQ Option.
IQ Option’s customer service or experience features are specifically developed to appeal to the investor. The company wants to introduce clients to the world of binary trading and show them how its investments can have incredible results. The truth of the matter is that binary trading is very risky. Even the SEC warns about foreign-based binary trading.
What Does This Mean for Me?
There are plenty of other brokers to choose from who have not received customer criticism, therefore IQ Option should be very carefully investigated before one decides to invest in its options. Potential investors should consult others who used IQ Option before any form of investment.
With honesty, IQ Option cannot be recommended. There are far too many negative attributes than positive. In fact, some of the negative attributes of the company are significant red flags. Of course, everyone has the ability to invest in whatever platform or company they may choose, but it would be wrong not to warn about IQ Option’s flaws.